LPG Prices Spike as Strait of Hormuz Remains Closed

Why It Matters

The price shock threatens household energy affordability across Africa and could reverse progress on clean‑cooking initiatives, while placing unsustainable fiscal pressure on governments that subsidize LPG.

Key Takeaways

• East Africa LPG prices up 90% amid Hormuz closure
• West Africa price rise lower, 70% increase
• Tanzania cuts VAT on LPG imports to ease cost
• Côte d'Ivoire keeps cylinder price stable despite higher imports
• Higher LPG costs risk shift back to polluting biomass cooking

Pulse Analysis

The prolonged closure of the Strait of Hormuz has tightened global liquefied petroleum gas markets, driving a sharp supply‑demand mismatch. Although sub‑Saharan Africa imports only a small fraction of its LPG from the Gulf, the disruption forces buyers to turn to alternative suppliers, inflating freight and contract costs. This indirect transmission of price pressure explains why East Africa faces a 90% price jump while West Africa, which leans more on U.S. imports and domestic production, sees a comparatively milder 70% rise.

For households, the surge translates into a tangible budget strain—IEA analyst Marina Petrelli estimates an additional 5% of income devoted to cooking in East Africa. Governments are scrambling to mitigate the impact: Tanzania has eliminated VAT on imported cylinders, and Côte d'Ivoire continues to enforce a regulated 6 kg cylinder price of roughly $3.55 despite soaring import costs. While such subsidies shield consumers in the short term, they shift the fiscal load onto state coffers, raising concerns about long‑term sustainability as budget deficits widen.

Beyond economics, the price shock jeopardizes public health and climate goals. LPG, though a fossil fuel, cuts household air pollution dramatically compared with traditional biomass, which causes over 800,000 premature deaths annually in Africa. Rising costs risk pushing vulnerable families back to firewood or charcoal, reigniting deforestation and emissions. The episode underscores the need for diversified clean‑cooking solutions—such as renewable biogas or electric induction—to reduce reliance on volatile fossil‑fuel imports and safeguard both health and environmental outcomes.